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By a small margin punters think the next general election will happen before Brexit

August 20th, 2019


Chart of Betfair Exchange from Betdata.io

We’ve discussed the timing of the next general election a fair bit on PB and my guess is that we’ll return to it quite often in the next few weeks.

It might not be as easy for a general election to be called as many seem to think. For a general election to take place the Fixed Term Parliaments Act makes it a requirement that two thirds of the entire House of Commons, 433 mps, vote for it.

The problem here is that there are quite a number of MPs in the main two parties who are very much split on Brexit and it might be that you won’t see the same level of unity in either party backing a proposal to go early as happened with Mrs. May in April 2017.

Given current Scottish polling has the Tory position north of the border looking dire maybe not many Scottish Tories would support a BJohnson general election motion. The same could apply to those seats where the LDs, who’ve tripled their GE2017 vote according to several polls, are in contention.

We have a reports of rebels in both the Tories and LAB who are not prepared to follow the leadership line on Brexit related matters. Quite how we quantify this is hard the say but given that some MPs, by voting for an early election, could be voting to deprive themselves of their income and their standing as members of parliament than it could be harder than it appears.

The LAB threats to deselect certain MPs by imposing mandatory re-selection is hardly going to help things.

The other way an election can be called is by the Tories losing a confidence vote which is not rescinded within two weeks. Given the current numbers it is hard to see enough backing the move.

Mike Smithson


 




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By signing the Good Friday Agreement 21 years ago the UK made any subsequent EU exit harder and more dangerous

August 20th, 2019

Johnson’s challenge: not triggering off a new round of troubles

In a post here last year I highlighted an article by John McTernan, Tony Blair’s former director of political operations, which sought to set out clearly why the Northern Ireland border has been such an issue in the Brexit negotiations. He wrote:

“.. there is no concession that can be given on the backstop or, as it should properly be considered, Northern Ireland. The fundamental problem here is not the intransigence of the Irish government not the trickery of the European Union. It is, put bluntly, because the UK is bound by a peace treaty – the Good Friday Agreement – which ended the 30 years warfare of the Troubles.

The agreement saved lives, and is still saving them, and it dealt with the border – the source of the conflict – in an extraordinary act of imagination. It dissolved it. Not merely within the operation of the EU Single Market but by the UK government repealing the act that partitioned the island of Ireland and by agreeing that the people of Northern Ireland could choose either a British or an Irish passport..”

For many this was all a long time ago but was and remains hugely significant. The agreement was signed in 1998 and most people under 40 have little awareness of the troubles and how they dominated British politics from the late 1960s onwards. It is hard to see how this agreement could have been reached if it had not been for both the UK and Ireland being members of he EU.

I still remember very clearly one of my first jobs as a journalist in Newcastle upon Tyne in the late 1960s being asked to contact the parents, who lived locally, of Gunner Curtis the first British soldier to be killed in the province. This was a hard task for a 22 year old. Many more deaths and atrocities were to follow and the “troubles” were the most dominant domestic story for three decades.

The Good Friday Agreement was a massive development for which both John Major and Tony Blair are rightly given a lot of the credit. It was approved in referendums on both sides of the border.

It is very hard to see how the United Kingdom can remain intact if the UK leaves the EU and who can predict what that will lead to? Remember that during the troubles there were ruthless loyalist community paramilitaries as well nationalist ones.

Mike Smithson




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The Season of Myths

August 19th, 2019

As we approach witching hour, a handy cut-out and keep guide to some of the more common Brexit myths.

Britain will be in good company outside the EU.

There are lots and lots of countries outside the EU, mostly surviving, many thriving happily, say Leavers. What are we so afraid of? Well, yes, there are. The majority in fact. (Though not the majority of countries in Europe.) But it’s a false comparison. The number of countries who have been in the EU for over 4 decades and left overnight is zero. The only part of the EU which has ever left was Greenland, and that after 12 years.  It remains an EU overseas territory subject to many EU laws; its citizens are EU citizens. So not that much of an exit.  Britain is not a Greenland, save possibly that Britain’s current government seems willing to barter parts of the country’s assets to get an FTA with the US, Greenland being rather firmer in stating that it and its assets are not for sale.

Of course, countries can thrive outside the EU. But there is a difference between having a society and economy which has developed outside the EU and having one which has developed inside it and then decides to cut all those ties overnight.  The latter will certainly be a case of British exceptionalism.  Quite what sort we will soon find out.

Brexit is a Conservative move.

Britain should never have joined the EU; Brexit merely corrects that mistake. Joining was a very unconservative act; it’s only right that today’s Conservatives should be the ones to restore national sovereignty.  So goes the argument. Arguably, the development of the EU over 43 years in many small steps slowly changing from what it was then to what it is now is a somewhat conservative approach to change: slow and incremental rather than one Big Bang.  But even if not, it is possible for both the original decision to join and the decision to leave to be mistakes.  An original mistake is not necessarily corrected by reversing it 46 years later.  And such a reversal – especially if done overnight as currently intended – is not obviously very conservative.  It is quite the opposite of slow and incremental. Rather revolutionary, in fact.

The Status Quo Ante.

This applies to both Leavers and Remainers. Some Leavers seem to think that life will be as it was pre-1973 (though without all the bad bits – inflation, strikes, dreadful food and bombs in Northern Ireland – oops! maybe scratch that last one). A misty-eyed romanticism involving the Commonwealth is usually somewhere in the background.

Remainers too have simply ignored the fact that, were Brexit to be reversed or were Britain to rejoin the EU in short order, its relationship with the rest of the EU would be irrevocably changed (even if all current opt-outs were maintained).  And the EU too is changing, as the new Commission President’s suggestion that QMV be used for taxation matters demonstrates. (How will “No taxation without representation” cope with that?) There is no going back for either side. Neither is really thinking about the future. This is a particular problem for Remainers/the “No to No-Deal Brexit” brigade. What do they want? No wonder all their focus is on short-term tactics. But what is their strategy?

We Have a Plan.

Contingency planning is being done; has been done even. (Or not, depending on whether the Leaver wants praise or to blame someone else.) There is no need to worry. Any concerns are just Project Fear: unwarranted and a slur on British pluck and self-belief.  “There is nothing to fear but fear itself” as Boris might have said, had he reached the letter “R” in his Big Boys’ Book of Quotations.  But there is all the difference in the world between contingency planning for one-off and usually short-term events (where quite a lot can be done) and planning for continuing disruption and change, let alone for the unknown unknowns arising from such change.  As the Gibraltar Government has said: “the fact that the Government has responsibly done everything possible does not mean that things will not be different…….That means changes even in the basic, underlying infrastructure of life.”  It can all be neatly summarised in their phrase “not a bed of roses”.  And that’s for 34,571 people in 6.7 kms².  Imagine what needs doing for a landmass of 242,495 kms² populated by 68,833,829 people.

A Wonderful Liberation for the Country.

Yes, well, only if one believes that the country has been oppressed by the EU. But let’s put that to one side. The author of that phrase, the current Leader of the House, a year after describing Brexit thus, said: “The overwhelming opportunity for Brexit is over the next 50 years.”  Which will be scant comfort to sheep farmers wondering if they will have a market for next year’s lambs or the elderly wondering if there will be care workers to help them get washed and dressed or any exporter to the EU wondering if they’re allowed to keep data about customers based in the EU.  Still, it’s nice to know that liberation now means not having to follow regulations you’ve had a role in drafting and agreeing to and not, as it has meant for most of Europe in the last century, freedom from brutal, violent dictatorships. What a marvellously supple language English is!

Parliament will not permit a No Deal Brexit.

A myth? Each and every MP is against something. There is no end to the list of things that MPs don’t want. What is proving mythical is finding the one thing that a majority of them do want and are able to enact.  Herding fat camels through invisible needles would be an easier task.

Desperate as everyone is to move on from Brexit, I fear I bring bad news. There are three issues which will dominate British politics for the foreseeable future:-

 (1) What the consequences of a No Deal Brexit will mean for our politics. Will those who voted for it benefit from it? And if not, how will they react? And how will those who bear its costs behave? 

(2) What the Remainers/Anti-No Dealers will do. Will they campaign to rejoin the EU? And, if not, where will their votes go?

(3) What sort of relationship Britain will have with the EU in future. And how it will get it.

 Perhaps the biggest myth of all is that Brexit will be over on 31 October 2019.  If only.

CycleFree




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Corbyn’s big speech – David Herdson’s take

August 19th, 2019



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Former White House Coms Director predicts Trump will quit WH2020 race by March

August 19th, 2019

Could it be that the President won’t be the nominee?

Over the weekend I’ve placed of bets at effectively about 10/1 that Trump will not be the Republican nominee at WH2020. I’ve done this by laying Trump on the Betfair 2020 nominee market. This has been prompted by two developments.

First there have been the public comments of former White House Coms Director, Anthony Scaramucci, who has been infuriating Trump over the last few days with a series of TV interviews. These have been widely covered. In response the President is pointing out that Scaramucci only served at the White House for 11 days before he got fired and knows, in the President’s word, nothing about what’s going on.

Scaramucci’s actual comment in an interview that is relevant to my bet is this:

“He’s gonna drop out of the race because it’s gonna become very clear. Okay, it’ll be March of 2020. He’ll likely drop out by March of 2020. It’s gonna become very clear that it’s impossible for him to win.

He’s got the self-worth in terms of his self-esteem of a small pigeon. It’s a very small pigeon. Okay,” Scaramucci continued about Trump. “And so you think this guy’s gonna look at those poll numbers and say — he’s not gonna be able to handle that humiliation.”

Scaramucci is basically saying that his reading of Trump is that such polling might lead to Trump not wanting to go  forward. The prospect of defeat is something that he would be unable to cope with.

This was followed by new polling from Fox News showing just that. It suggested that Trump was someway behind each of the leading contenders. These had Biden leading him by 11, Sanders by 9, Warren by 7 and Harris by 6.

My bet is simply that Trump has less than a 90% chance of being the nominee.

Mike Smithson


 



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What will the UK interest rate be at the end of 2019?

August 18th, 2019

I really don’t know much about economics and the intricacies of how and interest rates are set by the Bank of England, looking at this market from Paddy Power is a bit like pinning the tail on the donkey for me.

My theory on this market is that is Project Fear turns out to be very close to Project Reality then Sterling will seriously and quickly tank as we head to No Deal.

The only time I can remember a similar situation in my lifetime was the legacy of Margaret Thatcher’s final act of European integration came under attack from the Brexiteer bogeyman George Soros on Black Wednesday.

Back in 1992 interest rates were raised from 10% to 12% then a further increased was announced to 15% so raising interest rates is one lever to stop your currency tanking, albeit in 1992 the government set the interest rates, now that power resides with the Governor of the Bank of England. The interest rate increases were cancelled the next day but my hunch any increases will last longer especially given that how historically low current interest rates are

On that basis I think the value is backing the 14/1 on interest rates being 2% or higher at the end of the year but perhaps PBers can convince where the value in this market is. Over to you.

TSE



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Meet the next Prime Minister. Maybe

August 18th, 2019

Could this former member of the Monday Club be our next Prime Minister?

John Bercow as Prime Minister seems outlandish even in these interesting times. There’s not enough bandwdith on the information superhighway to list all the reasons why this is a bad idea or why John Bercow is so unsuited to be Prime Minister but given the desperation amongst MPs to stop a No Deal Brexit then something outlandish needs to happen.

Do I think Bercow has the ego to think he could be the man to prevent no deal? Hell yes! Is Bercow prepared to set aside Parliamentary convention? Hell yes, in fact he did just that earlier on this year.

Today’s Sunday Times has the following story

Many years ago someone told me that ‘Napoleon had a Bercow complex’, now that Bercow is involved in a plot to stop a No Deal Brexit then it isn’t hard to see how the conversation turns to him offering himself as himself as the man you need if you want a temporary non partisan (sic) Prime Minister to prevent No Deal.

I can see how that might appeal to MPs who really don’t want to make Jeremy Corbyn Prime Minister, it could appeal to Corbyn to make someone Prime Minister who really won’t be Prime Minister for long, nor leads or is a member of a political party.

I’ve stated that I consider this a pretty outlandish suggestion, the bookies agree, at the time of writing no bookie has John Bercow listed in the next PM market, but they do have another Arsenal fan, Piers Morgan, at 500/1 but if Bercow is added in this market I’d be very interested, depending on the odds.

I think MPs who respect the referendum result but are implacably opposed to both a No Deal Brexit and a Corbyn Premiership are looking for a ‘Hail Mary’ option Bercow as Prime Minister could well be it. Having one person concurrently holding the job of Speaker and Prime Minister would ensure the smooth running of the government in Parliament, something that hasn’t been happening recently.

TSE



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On the betting markets punters are becoming LESS convinced that there’ll be a 2019 General Election

August 17th, 2019


From Betdata.io – the last month on Betfair GE year market

But 2019 still a strong odds-on favourite

As can be seen from the chart there has been a huge amount of volatility on the year of the next general election with punters starting to move back from 2019 which got to a 73% chance earlier in the week.

As we know under the Fixed Term Parliaments Act there are two ways an election can be triggered ahead of 2022 when the next one is officially due – the government loses a vote of no confidence or if two thirds of the entire House of Commons (433 MPs) vote for one.

The former has become less likely following the growing realisation that Corbyn does not have the numbers to bring Johnson down. The law states that a general election should be triggered if a no confidence motion is carried by MPs and not rescinded within 14 days. What happens in that fortnight is less clear.

The current MP totals point to several Tory MPs having to back the no confidence moe for it to succeed and it is hard to see sufficient coming forward.

The other way of an election being triggered is, like happened in April 2017, two thirds of MPs vote for one. If BJohnson sought to call a general election when parliament returns next month he cannot assume that he’d get the numbers. This could be portrayed as a means of avoiding parliamentary scrutiny during the critical build up to the October 31st Brexit date. My guess is that even if Corbyn backed that he would struggle to get the support of his full party.

One element that could cause LAB MPs to be less keen is the pressure from the hard left in the party to be subject to compulsory re-selection. How many would fail to back the move for fear of losing their jobs.

A contrived Johnson/Cummings measure to avoid the Commons on Brexit would be seen for what it is and provide the perfect cover for those LAB MPs worried about being de-selected.

A total of 433 MPs have to actually vote for the move and many could conveniently find reasons not to be in the Commons on that day.

Just because TMay found it easy getting MPs to the vote for GE2017 doesn’t mean that it will be the same for Johnson.

Mike Smithson