‘When one with honeyed words but evil mind persuades the mob, great woes befall the state.” Euripides was not of course referring to Brexit in his play Orestes, but to the chaos caused by Clytemnestra’s murder of Agamemnon and Orestes’s dispatch, in turn, of Clytemnestra.
The disastrous outcome for the Conservatives in the local elections may not lead to any physical violence, but all the signs are, as the recriminations begin, that the Tories are in for a metaphorical bloodbath.
Let us face it: the Brexiters, led by Boris Johnson and Nigel Farage, conducted their referendum campaign with honeyed words; their minds may not have been intentionally evil, but you could have fooled me. Brexit has proved to be an unmitigated disaster.
The evidence mounts that great woes have befallen the state. But this is only the beginning. Our imports from and exports to our nearest and most important trading partner, namely the EU, are already suffering from serious delays – in some cases coming to a halt as businesses decide to give up the ghost. The bureaucracy is going to become far worse at the end of the year, when the full impact of the trading limitations the government has imposed on itself is due to be felt.
Meanwhile, our scientists are hampered by lack of access to the EU’s Horizon programme, the young can no longer enjoy the educational benefits of Erasmus student exchanges, and freedom of movement is inhibited in all sorts of ways. Moreover, as the realities of modern economic diplomacy point to the wisdom of belonging to a European group that can hold its own in the face of US and Chinese influence, we are left hanging on the fringes with precious little bargaining power.
And yet, and yet: the Labour leader, Keir Starmer, continues to rule out the chance to go down in history as the man who called the Brexiters’ bluff, made a big issue of the hundreds-of-billions cost of Brexit, and demanded nothing less than re-entry to an organisation we never should have left.
Starmer was riding high last week, basking in the pathetic performance of the Tories in the local elections and opinion polls. His Commons performances vis-a-vis the hapless Rishi Sunak are even beginning to remind people of the great days of Harold Wilson as opposition leader.
But the truth is that the shadow of Brexit hangs over those election results. The Conservatives did badly partly as a result of the nation finally revolting against their abysmal 13-year record, but also because the spreading woes of Brexit are coming home to those who rightly feel they were hopelessly misled by honeyed words.
The Lib Dems did well because they have made the right judgment on Brexit, and are not afraid to say so. Labour has not done as well as it should because many pro-European voters have made their feelings known by switching to the pro-European Lib Dems.
And another thing: the persistently high level of inflation is much in the news, and being felt in many people’s pockets. But there can be little doubt that this country’s rate of inflation is higher than that in the US and EU.
It is higher because of the dramatic impact of Brexit on import prices. The young are amazed that the Bank rate has been raised to 4.5%, but those with long memories recall that, years ago, a “crisis” rate was 7%. The difference is that, in those days, the inflation rate was 3-4%, not 10% or more, as recently.
Anyway, with good timing, the economist Stephen D King – senior adviser to HSBC, not the novelist – has written a fine guide on this subject entitled We Need To Talk About Inflation. Among other things, he is wary of the faith being placed in central banks. As he says: “The really tough policy decisions – most obviously the costs associated with squeezing excessive inflation out of the system – may ultimately require some form of political validation.”
He thinks that “avoiding tough action may have contributed to further inflationary pressures”, and draws an interesting contrast between the “avoidance” approach of the US Federal Reserve chairman Arthur Burns in the 1970s and the tough, indeed brutal, hoisting of interest rates to 20% by his successor, Paul Volcker, in the 1980s.
These are deep political waters. But there can be no doubt whatsoever that the Bank of England’s attempt to control inflation has not been helped by our departure from the EU. Nor that, when the figures for the annual rate of inflation do fall, the impact of previous rises will still be felt by a country that has been made poorer by Brexit.
