...a blog by Richard Flowers

Monday, October 17, 2016

Day 5769: Marmite Wars are Merely the Beginning


Today Captain Clegg launched his third pamphlet on the challenges facing the UK due to Brexit. This one is about food and drink.

Nick Clegg at the National Liberal Club

If you’re still watching POLDARK on the BBC you will know it’s a tale of noble-but-impoverished workers of mine and land, ground down by the machinations of sinister bankers who manipulate the laws and the local dimwit Tory MP for their own ends, and so must turn to smuggling to get goods past the exorbitant import tariffs.

What you might NOT realise is that this is a BOLD sci-fi drama set in the DISTOPIAN post-Brexit FUTURE! With occasional topless scything.

And the reaction was basically terrifying. (To Brexit, not the topless scything!)

That’s not the position of Captain Clegg – who was at pains to point out that we should definitely be trying to save people from their fears by at least agreeing a Norway-style EEA agreement that maintains our trading links.

No, the fear was present in the questions arising, questions from small farms, from small retailers – corner shops and newsagents – who are all already staring down the barrel of disaster as the collapse in the pound sees their prices soar; the sort of everyday working folk whose concerns for their businesses and livelihoods and families are dismissed from the ivory towers of Conservatories like Jacob Rees-Mogg who’s never had to do a day’s work in his life and puts down the questions of ordinary people as “just more Project Fear”.

And another very good question came from the Commonwealth countries who can see their gateway deals to the EU via the UK collapsing and WTO trade tariffs of 40% on chocolate or 50-60% on beef and lamb being imposed by the careless diktat of Liam “Fantastic Dr” Fox, disgraced former Defence Minister and not-yet-disgraced (‘96 days and counting’) International Trade Minister.

Across the continent, the papers are not full – as Cap’s Nick put it – of the cunning of Mr Fox, the honesty of David Davis or the diplomacy of Boris Johnson. No, our friends and allies are instead AGHAST at the language and occasional downright xenophobia coming out of this chaotic Tory government, particularly things like the conference speech of the “Go Home” Secretary, Ms Green Amber Rudd. Less of a dog whistle; more of a traffic light stuck on stop!

Prime Monster Theresa May (or May Not) holds out against delivering ANY answers beyond Brexit means Brexit means a slap on the wrist for ministers who dare to speak the unspeakable, but insists that she has the power to Invoke Article 50 without taking a vote in Parliament. Talk about “taking back control!” Will those Tories – David Davis, John Deadwood, Peter Bone, Rees-Moggy? – who made such a BIG THING of Parliamentary Sovereignty call her to account? Or will they sell their principles in a heartbeat?

MPs were EXPRESSLY told that the Referendum would be only ADVISORY – or else they might have voted for more stringent checks, such as a two-thirds majority, or other thresholds – and those Brexiteers who are trying to say that in passing the referendum BILL Parliament has already voted on Brexit are clearly trying to take away the democratic and sovereign rights of Parliament.

Noted thinker A. C Grayling is writing to every MP to ask them why they are allowing this, and that they should demand a debate AND VOTE on the issue.

It is, after all, their DUTY to “take back control”.

It is clear that unchecked, Mrs Maybe’s unelected administration will see us BOUNCED into the most CHAOTIC TORY BREXIT!

Unilever and Tesco may have come to an accommodation that sees the Marmite back on our shelves, but that’s far from the end of it.

We currently SELL more than £18 billion of food abroad, one of our biggest export industries, and two thirds of that goes to the EU. Tariff and other barriers, like regulations or defining chocolate to be only high cocoa solids, that would exclude British chocolate altogether, will more than eliminate any benefits of the cheaper pound. And THEN we have to compete with the highly subsidised EU food production because THEY’LL still have the much-derided Common Agricultural Policy that WAS pouring billions into OUR farms.

But also we EAT more than we can GROW, so we have to BUY IN more than 25% of the food we need, and more than 70% of that is from Europe.

Companies importing food are going to face a choice of three options: put up prices – difficult in a cutthroat market with discounters already at their heels; cut into their own profits – which are already very tight, especially for small firms that import ingredients to make into prepared foods; or stop stocking certain lines altogether – the Marmite option.

For the moment, big importers will have their prices protected – either by long-term agreements with their suppliers or by insurance (called “hedging”) that will cover the higher cost of buying stuff with a pound that is worth up to 18% less.

But small companies who can’t afford big insurance are being hit with those choices already.

And even the bigger companies, their contracts will run out and, as Tesco discovered, new agreements will need to be made; those insurance policies are to smooth out short-term the ups and downs of the currency markets, not to protect long-term from a major devaluation. And then the higher prices will have to be paid.

In the next year to two years we will see a (first) big spike in food inflation, and that will hit the least well off the hardest.

We need to work RIGHT NOW to protect against an even bigger hit from collapsing out of the Single Market.

As Master Yoda so very nearly said of Bojo’s foreign policy: Victory? There was no victory. Begun, this clown war has.

Steve Bell in the Grauniad