No deal’ is not a destination. It is simply a volatile and uncertain transitional state of purgatory, in which you have forfeited all the leverage to the other side because you start with a blank slate of no preferential arrangements, and live, in the interim – probably for years – on a basis they legislate – in their own interests. At 27. Without you in the room, and without consulting you politically. So much of our debate about ‘being ready here for ‘no deal’ therefore totally misses the point.

TL;DR.

We all know this is a great country. Sadly, it’s one currently very poorly led by a political elite, some masquerading as non-elite, which has great difficulties discerning and telling the truth. I am discouraged by just how badly Brexit has been handled to date, and currently pessimistic that this is going to get any better any time soon. I am worried that the longer the sheer lack of seriousness and honesty, the delusion mongering goes on, the more we imperil our long-term prospects.

It is not patriotism to keep on failing to confront realities and to make serious choices from the options which exist, rather than carrying on conjuring up ones which don’t. So I thought what I should do today is offer you candid advice on:

Why I believe ‘no deal’ is now the probability. To be clear, it is a majority chance, not an inevitability. Why going to – or rather, as I shall explain, via – ‘no deal’ would be bad for the UK. Bad for the EU too, but much worse for us. How you should think about what ‘no deal’ would look like for you, given that you are being sold any number of absurd fantasies about how it would play out. Nearly all from the people who sold you absurd fantasies about how the last 3 years would play out. Finally, some thoughts about how, even now, we might find a saner route to a post Brexit destination which is economically viable, if sub-optimal, and delivers a vibrant democracy and strong relations with both our key EU partners and the rest of the world.

I talk about a ‘post-Brexit destination’ deliberately because my starting point has always been that the democratic mandate of June 2016 needs to be fulfilled. The vastly overwhelming majority of the 17.4 million people who voted for Brexit are not fools, knaves or bigots. They had, and have, serious and justified grievances with the status quo, whether or not one believes that EU membership is a major impediment to changing it. And they have the right to expect the political elite to deliver on the mandate, and to feel let down that it so far has not happened. I can’t blame them. But, they also have the right – the whole electorate has the right – to have the political class level with them about what Brexit actually entails doing. And about the inevitable choices and trade-offs it imposes on us, rather than just stir up feelings that Britain has been in some way humiliated.

The only people who have truly been humiliated are those in both the Executive and Legislature, many of whom are now marketing the national humiliation and betrayal story hard, precisely to try and escape their own profound responsibility for the current political paralysis. I now think a ‘no deal’ outcome the probability, for reasons I shall explain. But I have thought it a serious risk since autumn 2016, and been saying to private sector and university audiences since then that I thought the risk was vastly underpriced by the markets, most companies and the media. Why? Because the previous Prime Minister kicked off the negotiation process with two speeches – at the 2016 Party Conference and at Lancaster House in January 2017, which I think frankly were two of the most ill-advised speeches given by a British Prime Minister since the War. Those speeches revealed a fundamental misunderstanding of the nature of our post-Brexit options.

And of the scale, length and complexity of the disentanglement process which Brexit entails. That misunderstanding perpetuates itself even now in the surreal debates we see unfolding 3 years after the referendum. And those speeches completely cemented the total unity of the 27 in how to run the Article 50 process – which had been very much in doubt, and which has held ever since – and enabled them, in conjunction with the decision to invoke Article 50 before the slightest consensus had been built as to where we wanted to get, to take complete control over the conduct and sequencing of the negotiations. The then Prime Minister was of course thunderously applauded for the approach in these early speeches by the very colleagues and media who have then spent the bulk of the following years determined only to bring her down, and to reject any deal she brought back. She was lionised in the press as a cross between the new Iron Lady and the new Boudicca. The EU would be brought to heel – indeed, as I recall, crushed beneath it – it did not deliver the deal we wanted. In reality, she had already signed her own political death warrant.

Prepare yourselves now, incidentally, for a new exciting version of this story in autumn 2019, when the new prime minister will be lionised for bold statements about how the UK will now negotiate with vision, determination, optimism and guts. Which will, I fear, be met with precisely the same reaction outside the UK, and deliver the same spontaneous complete solidifying of the 27’s position – in the face of being told endlessly that now we finally have a prime minister prepared both take them on at the table, and to walk away from it, their united front will duly crumble, and we shall then walk away with the deal of his dreams. The ‘belief’ theory of negotiations – if we just have enough true belief, confidence in our greatness and chutzpah, we shall achieve all we want – always reminds me of some of the more ill-fated underachieving England World Cup campaigns of past decades. The pre-tournament ‘this time the Cup is coming home’ media spree is this year’s Tory Party Conference coverage…. I was in Brussels running the preparation process for the then Prime Minister’s first European Council in October 2016, and able to feel the severe frost – and, as I say, also the total internal solidarity – her speech 10 days previously to the Party Conference had engendered.

Well just think ahead to the October European Council this year, 3 years on, which will be the EU debut, and perhaps the final curtain too, for the next prime minister, just 2 weeks after a first Party Conference leader’s speech. And do we think whoever wins the leadership contest will, in their first leader’s speech to Conference have set out a subtle, nuanced, principled and collaborative approach to sober up the Party faithful for the many difficult compromises ahead? As the former Prime Minister gradually came to understand that these speeches had locked her into a position both wholly unsustainable and undesirable from the UK economic viewpoint, every baby step she then took to nuance her position, in particular, to address UK manufacturers’ concerns, and prevent the decimation of key industries, was met with howls of outrage from her Right as the betrayal of the ‘only true path’ Brexit. Which, it turned out, was a hard ‘no deal’ Brexit which had not been the prospectus sold to the public in the referendum campaign.

I won’t try and rehearse the full gory history. Better not to not waste time, and to look forward. But let’s also try this time not to lock ourselves into positions from which the only conceivable exit leads to accusations of betrayal, humiliation and ‘stab in the back’ from all the usual suspects. Suffice it to say that every successive iteration, from Florence to Mansion House to Chequers of the former Prime Minister’s version of Brexit went down progressively worse with her Right. And having agreed the backstop proposal in December 2017, the Prime Minister’s only escape route from a Northern Ireland specific backstop was the all UK backstop she urged EU leaders through autumn 2018 to insert in the legal Withdrawal Agreement. Telling them indeed that only this would win her the ‘meaningful vote’ in the House. They duly gave her what she asked for and signed it off now 7 long months ago. But it was just never going to fly. Her strategy of ‘you’ll see: it’s my way or the abyss and you will have no other or better choice in the end, because I will prevent any other emerging’ held no terrors for those who much preferred the abyss – because, for them, it was not an abyss but a ‘clean break’ liberation. And her deal delivered too close an economic and juridical relationship with the EU ever to be tolerable for them. None of this – surely to goodness – can have been a surprise to No 10.

They will, of course, take the same position under the new prime minister and they believe the wind is in their sails and they can deliver the so-called ‘clean break’ and hope finally to have a prime minister committed to it. Nor did the Prime Minister’s threats hold terrors for those whose worst nightmare was ‘no deal’, because they thought they had the numbers in the Commons always to see off ‘no deal’ and could see that she herself was endorsing that view in what she was telling their political enemies. They too believe the wind is in their sails and that they can reverse Brexit. So the strategy was never destined to work, and European leaders progressively, and correctly, lost all faith in her ability to deliver.