Brexit lacks credibility – but Remainers lack leadership

To say that the lunatics have taken over the asylum would doubtless be termed politically incorrect. But the uncomfortable truth is that a bunch of ideological Brexit clowns have perpetrated a coup on the British government and the majority of the British people.

Seldom – or, to be more precise, never – in half a century of covering British economics have I encountered such a failure of leadership at a time of crisis. We came close to the abyss in 1976 but were saved by Jim Callaghan, the prime minister, and Denis Healey, the chancellor. On that occasion, after fraught talks, the two held the cabinet together and negotiated a loan from the International Monetary Fund which restored our credibility in the markets.

Callaghan and Healey were political giants. So were the dissidents such as Tony Crosland, Michael Foot and Tony Benn, whom they managed to win round. And their civil servants respected what their political masters were trying to do.

No such respect now, and not surprisingly. It is increasingly obvious that, in Brexit, the British public has been sold a pup. The negotiations with our EU counterparts and the debate in Westminster have reached satirical proportions for one simple reason: the government has embarked on Mission Impossible.

This, I think, is the principal explanation for the deepening nastiness in tone of the more vociferous Brexiters. It started with the execrable attack by the Daily Mail on the supreme court for concluding that parliament, not the executive, should have the ultimate say.

The irony that the Mail and their Brexit friends were campaigning for bringing back ultimate authority from European law to British lawyers whose judgment they objected to seems to have escaped them. Then they moved on to attack those of us who wish to call a halt to this Gadarene rush to the Brexit cliff as “saboteurs” or “traitors”. What a wonderful distortion of language it is to describe patriots as traitors! Then, last week, we had the Daily Telegraph, in former days renowned for the fairness of its news coverage, making the main news on its front page photographs of 15 Conservative MPs presented as a kind of rogues’ gallery, with the banner headline “The Brexit Mutineers”.

All this smacks of panic in the ranks of the Brexiters. And yet, if there is not exactly panic in the ranks of the Remain camp, the complaint I continually hear is that it still lacks a strong leader. Why, even George Osborne’s biographer, Janan Ganesh, was hinting in the Financial Times last week that it needs someone with the determination of Gordon Brown.

The recent publication of Brown’s fascinating memoirs reminds one, too, of his heroic exercise of leadership in 2008-09, in rescuing the world economy from the financial crisis. His memoirs contain a strong defence of the Keynesian measures he took and preached to others – an example of leadership that won the approbation of Presidents Obama and Sarkozy.

Unfortunately, the stimulus in this country was withdrawn prematurely by the Conservative/Lib Dem coalition, whose policies of austerity from 2010 onwards damaged not only the social fabric but also investment and the productivity on which it depends.

Indeed, as Remainer Philip Hammond has been drawing up the budget – due on Wednesday – the Office for Budget Responsibility has warned that the economy’s enfeebled productivity places a manifest constraint on his room for manoeuvre, as does the prospect of Brexit.

This does not, of course, deter the Brexiters: not at all. Both the ubiquitous Jacob Rees-Mogg and that long-time Eurosceptic John Redwood – one of John Major’s “bastards” – have told the Treasury to make its forecasts more optimistic, so that a cushion can be provided for the damage that will almost certainly occur if Brexit is not stopped. Redwood knows the score: in his capacity as an investment adviser he has been downplaying the prospects for Britain and advising clients to invest in, er, mainland Europe.

Redwood and Rees-Mogg seem blissfully unaware that, first, the Treasury no longer makes pre-budget forecasts, and, second, that it was precisely to discontinue the ancient practice of chancellors trying to fiddle the forecast that responsibility for it was put in the hands of the OBR.

Incidentally, I do not blame non-experts for being misled by Brexiters’ false claims in the referendum. The Cameron government should have explained how the whole of the UK benefits from the EU. We are essentially a region of Europe, and take for granted a daily supply system of goods, services and – especially – food that would be severely disrupted by “no deal” and the consequent huge bureaucratic problems at the ports.

Only last week the benefits of being part of a strong trading bloc were demonstrated when the European commission made it clear that it would be acting for the UK in the dispute between Boeing and Bombardier. Brussels has clout in trade disputes; on its own the UK would be crushed in negotiation by powerful US lobbies.

When we applied to join the EEC in the early 1970s, the negotiations were founded on common objectives: both sides wanted UK entry. On Brexit there are no common objectives; hence the shambles. All this stuff about “negotiating” a £20bn divorce settlement is so much hogwash. We are legally bound to pay some £60bn in the course of the rest of the decade anyway.

That is, whether or not we go ahead on this disastrous course. My impression is that people are gradually hearing the opposite message, not least the young. If the polls move markedly in favour of Remain, then whoever is prime minister should broadcast to the nation that it is time to think again.